What is the difference between a bull and a bear market?

A bull market is when stocks go up in value, in turn improving the economy and employment rates. They usually last a couple of years. A bear market is when stocks are losing value, the economy looks uncertain, and unemployment might increase. Bear markets tend to last just a few months but can be longer.

Should you buy or sell a stock in a bear market?

Investors in a bear market are tempted to sell off their investments during this time to eliminate the risk of losing even more money. On the other hand, investors in a bull market may sell some of their stock for a decent profit or hold on in hopes of prices rising even more in the future.

When does a bull market start?

Although there is no formal definition of a bull market, it is common to say that the bull market starts when the prices rise at least 20%. The same can be said about a bear market. We usually refer to a market as a bear market when prices drop more than 20%. Not all traders would agree with this definition though.

Why do bulls attack the market?

Therefore when investors are lacking confidence and start selling assets, triggering a market declining trend, the market is called “bearish” and traders who sell expecting the market to drop are “bears”. Bulls, on the contrary, tend to attack when they are full of self-confidence, they charge and use their horns to lift their victim.